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Difference between self-actuating system and self-assessment system

Last updated 30 March 2020

Self-actuating system

A self-actuating system applies to tax periods and fuel tax return periods that commence before 1 July 2012. This means:

  • you complete and lodge an activity statement and no assessment is made at the time of lodgment
  • your liability to pay and your entitlement to receive a refund do not depend on an assessment.

An assessment is not made when the activity statement is lodged. However, we may make an assessment later – for example, as a result of an audit, or where you request an assessment to access your objection rights. Under the self-actuating system, recovery of debts and payment of a credit or refund is generally limited to a four-year period.

Where a processing error on a lodged activity statement is corrected and it results in a change to an amount on the activity statement, a change advice letter will be sent to the taxpayer.

Self-assessment system

The self-assessment system is modelled on the full self-assessment system that applies to companies and certain other entities for income tax purposes. Under the self-assessment system, an assessment is made when an activity statement is lodged. You no longer have to request an assessment to access your objection rights. You are only liable to pay an amount, or entitled to receive an amount, determined in your assessment. Once the liability or entitlement has been assessed there is no time limit on payment or recovery of the debt.

Under self-assessment, where a processing error on a lodged activity statement is corrected and it results in a change to a GST, LCT, WET or net fuel amount label, it is an 'amended assessment'. A notice of amended assessment will be sent. An amended assessment is also made where an individual label is changed but the net amount does not change, or where we make a change to your net amount or net fuel amount as a result of an audit we undertake.

Example: Errors on labels on lodged activity statement

Raj lodges an activity statement and includes an amount of $11,000 at the LCT payable label. The amount is included at this label in error – it should be included at the GST payable label. We make changes to the LCT and GST payable labels to correct the error. As there is an amendment to the individual GST and LCT payable labels, we have amended the assessment even though the net amount is not changed. We will issue a notice of amended assessment to Raj.

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